## Facts

- BlueEarth Biofuels, LLC pursued development of a biodiesel production facility on Maui and entered discussions with Hawaiian Electric Company, Inc. (HECO) and Maui Electric Company, Ltd. (MECO).
- BlueEarth and the utilities executed a mutual non-disclosure/non-circumvention agreement and a confidential memorandum of understanding governing project planning and development.
- The parties exchanged confidential and proprietary information during the development discussions.
- As the project progressed, the parties discussed potential fuel subcontractors, including Aloha Petroleum, Ltd.
- BlueEarth alleged that HECO, MECO, Aloha, and a HECO executive improperly used BlueEarth’s confidential information and trade secrets to structure the project to exclude BlueEarth.
- BlueEarth filed a federal civil action asserting, among other claims, misappropriation of trade secrets under the Hawai‘i Uniform Trade Secrets Act (HUTSA), breach of contract, and various tort and equitable theories based on misuse of information and project-related conduct.
- Defendants argued in federal court that HUTSA displaced BlueEarth’s non-contract, non-HUTSA claims.

## Issues

1. When does HUTSA’s displacement provision apply to “conflicting” tort, restitutionary, and other state-law civil remedies?
2. What is the scope of displacement for claims found to conflict with HUTSA?
3. Can claims that do not conflict with HUTSA still be displaced under HUTSA’s displacement provision?
4. Does HUTSA displace claims based on misuse of confidential information that is determined not to meet HUTSA’s statutory definition of a trade secret?

## Decision

- The Hawai‘i Supreme Court answered the certified questions and adopted a narrow view of HUTSA displacement.
- HUTSA displaces only tort, restitutionary, and similar civil claims that seek relief for misappropriation of a “trade secret” as defined by HUTSA and that are duplicative of the HUTSA remedy.
- Contract remedies are not displaced, whether or not they are based on misappropriation of a trade secret.
- Claims based on misuse of confidential information that does not qualify as a statutory trade secret are not displaced by HUTSA.
- Claims protecting distinct legal interests or requiring additional elements beyond trade secret misappropriation are not displaced merely because they arise from related facts.

## Legal Principles

- HUTSA displaces only “conflicting” state-law civil remedies that provide relief for misappropriation of a trade secret; displacement is aimed at duplicate remedies for the same wrong.
- “Conflict” for displacement purposes turns on whether the claim is based on the same operative facts as a trade secret misappropriation theory and seeks redress for the same harm.
- HUTSA expressly preserves contractual remedies, even when contract claims overlap factually with alleged trade secret misappropriation.
- HUTSA does not occupy the field of all confidential-information disputes; misuse of confidential information that does not satisfy the statutory trade secret definition remains actionable under other state-law theories.
- Tort claims based on independent duties or distinct harms (rather than solely on trade secret misappropriation) are not displaced.

## Conclusion

The court clarified that HUTSA displacement is limited to duplicative non-contract civil claims seeking remedies for statutory trade secret misappropriation; contract remedies, claims involving non-trade-secret confidential information, and independent torts with distinct elements or protected interests may proceed alongside a HUTSA claim.


BlueEarth Biofuels, LLC v. Hawaiian Elec. Co., 123 Haw. 314, 235 P.3d 310 (Haw. 2010)